PHINIA (PHIN) Q3 2026 earnings summary

Executive summary

• Q3 net sales were $912M, up 0.4% YoY; adjusted EBITDA reached $135M at a 14.8% margin, and adjusted diluted EPS rose 15.1% to $1.83.

• Strong execution, new awards and resilient demand supported progress toward FY26 objectives; diversified end markets and launches were cited as foundations for growth into 2027.

Financial highlights

• Net sales rose to $912M from $908M; core sales excluding tariff-related volatility increased $21M, while FX added $4M and tariff recovery timing weighed on reported sales.

• Adjusted EBITDA increased to $135M from $133M, with margin expanding to 14.8% from 14.6%; favorable product mix was partly offset by prior-year pricing comparisons.

• Net earnings were $67M versus $13M and diluted EPS was $1.80 versus $0.33; adjusted net earnings were $68M versus $63M and adjusted diluted EPS was $1.83 versus $1.59.

• Q3 gross margin was 22.4% versus 22.0%; operating income was $84M versus $34M, partly reflecting lower other operating expense after the prior-year separation-claims settlement loss.

• Operating cash flow was $87M versus $119M and adjusted free cash flow was $73M versus $104M; $17M of capital expenditures included tooling outlays.

Outlook and guidance

• FY26 net sales guidance increased to $3.625B–$3.675B from $3.565B–$3.665B; adjusted EBITDA guidance rose to $500M–$520M from $485M–$515M.

• Adjusted EBITDA margin guidance is 13.7%–14.1%; adjusted free cash flow guidance increased to $220M–$250M from $210M–$250M, and adjusted tax rate guidance fell to 28%–30% from 30%–33%.

• FY26 net earnings guidance increased to $160M–$182M from $155M–$180M; updated guidance includes expected Q4 stoba contribution.

• Less than half of the guidance increase came from stoba; organic growth drove most of the lift, led by CV strength and launch ramps, partly offset by China softness.

• Q4 revenue is expected to exceed Q3 at the guidance midpoint; longer-term targets include 2%–4% average organic revenue CAGR for 2021–2030, >40% adjusted FCF conversion and 14%–15% adjusted EBITDA margin.